The Tax Diagnostic process entails a non-invasive review of a taxpayers eFiling profile, through investigating the records held by SARS. This information is then compared with the taxpayer’s unique circumstance to determine if there are any discrepancies between the SARS records and current circumstance.
Alex Mahundla
SARS Tax Compliance Specialist
Chrispos Seete
SARS Process Administrator Expatriate Tax
Thereby allowing for tax planning and road mapping prior to SARS engagement as to mitigate risk for the taxpayer on future engagement with SARS.
The Tax Diagnostic process includes a detailed examination of the taxpayer’s asset portfolio to determine the likelihood of deemed Capital Gains Tax implications. This is particularly pertinent to those seeking to formally cease residency or deem non-residency to a foreign jurisdiction. As both cessation routes would require the taxpayer to meet the obligations of section 9H, which requires a deemed sale of all capital assets. As such, where a taxpayer has these potential for exposure this is flagged, and a computation engaged upon to determine the potential liability of cessation.
SARS has more actively highlighted the importance for taxpayers to keep their registered particulars up to date. Furthermore, in terms of Section 23 of the Tax Administration Act (“TAA”), an individual must within 21 business days, notify SARS when their registered particulars have changed. This is to ensure the below is achieved with the revenue authority:
The Tax Diagnostic Report is therefore a valuable tool for expatriates in providing a roadmap to assess and optimize tax compliance. The initial focus allows for peace of mind on historic compliance to ensure any potential hurdles are ironed out. Whereafter, the correct tax optimisation steps can be undertaken to ensure continued compliance, especially in the depths of complex expatriate tax regulations and laws.
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